Published on 4/2/2020 in the Prospect News High Yield Daily.
New Issue: Tenet prices upsized $700 million five-year secured notes at par to yield 7½%
By Paul A. Harris
Portland, Ore., April 2 – Tenet Healthcare Corp. priced an upsized $700 million issue of five-year senior secured first-lien notes (B1/BB-/B+) at par to yield 7½% in a Thursday drive-by, according to market sources.
The issue size increased from $500 million.
The yield printed at the tight end of the 7½% to 7¾% yield talk and tighter than early guidance in the high 7% area.
Bookrunners were Barclays, BofA Securities Inc., Capital One Securities Inc., Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, RBC Capital Markets LLC, SunTrust Robinson Humphrey Inc., Wells Fargo Securities LLC, Scotia Capital (USA) Inc. and Santander Investment Securities Inc.
The deal went well, with the notes playing to an order book that was heard to be three- to four-times oversubscribed, according to a New York-based trader.
The Dallas-based health care provider plans to use the proceeds to repay debt under its ABL facility and for general corporate purposes.
| Issuer: | Tenet Healthcare Corp.
|
| Amount: | $700 million, increased from $500 million
|
| Maturity: | April 1, 2025
|
| Securities: | Senior secured first-lien notes
|
| Bookrunners: | Barclays, BofA Securities Inc., Capital One Securities Inc., Citigroup Global Markets Inc., Deutsche Bank Securities Inc., Goldman Sachs & Co. LLC, J.P. Morgan Securities LLC, RBC Capital Markets LLC, SunTrust Robinson Humphrey Inc., Wells Fargo Securities LLC, Scotia Capital (USA) Inc. and Santander Investment Securities Inc.
|
| Coupon: | 7½%
|
| Price: | Par
|
| Yield: | 7½%
|
| Spread: | 713 bps
|
| First call: | April 1 2022 at 103.75
|
| Equity clawback: | 40% at 107.5 until April 1, 2022
|
| Trade date: | April 2
|
| Settlement date: | April 7
|
| Ratings: | Moody's: B1
|
| S&P: BB-
|
| Fitch: B+
|
| Distribution: | Rule 144A and Regulation S with registration rights
|
| Price talk: | 7½% to 7¾%
|
| Marketing: | Drive-by
|
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